Ghosts of budget past
Almost a year ago to the day, Jeremy Hunt delivered his first Autumn Statement that was haunted by the actions of his predecessor Kwasi Kwarteng in what was then described as the âKamiKwasi Budgetâ.
Mr Hunt spoke of the need to be âhonest about the challengesâ the country faced as it grappled with the ongoing cost of living crisis and rising inflation. He said the Government would have to take âdifficult decisionsâ in a bid to weather a âshallower downturnâ.
The outlook back then was bleak, but we can expect a more optimistic fiscal statement on Wednesday.
While the UK is by no means out of the woods and is unlikely to be so for some time, Mr Hunt will be eager to inject some positivity into proceedings as he points to inflation figures at 4.6 per cent and falling, and with one eye very much on a general election.
The Chancellor will be eager to press the message that the country must stay the course in keeping a lid on inflation, but he is also alive to the impact that the battle to limit inflation has on growth.
It is why Mr Hunt is widely expected to focus his package of measures, including tax cuts, on businesses rather than individuals despite widespread speculation of income tax cuts.
During his lengthy broadcast round on Sunday, he insisted that he wanted to put the country âon a pathâ to lower taxation for people but he repeated his line that he will not introduce âany kind of tax cut that fuels inflationâ.
Instead, the central message on Wednesday is one that is expected to be about how the Government will help grow the economy by boosting support for businesses.
Earlier this month, the Bank of England forecast that the UK economy will flatline until the end of 2025, which is not the sort of message a party in government wants to carry heading into an election.
Having laid the ghost of Mr Kwartengâs mini-Budget to rest, the Chancellor will now hope to stimulate green shoots of growth before delivering the likely cut in personal taxes in time for voters heading to the polls.
